Despite funding questions, Edmonton Oilers proceed with new downtown arena

EDMONTON - The Edmonton Oilers are moving full-speed ahead with a half-billion-dollar downtown mega-rink to replace aging Rexall Place, even though it hasn't been decided who will pay for it and who will own it.

"The development model for this has yet to be discovered," Oilers president Patrick LaForge said at a news conference at Rexall Place Monday.

He reiterated that Oilers owner Daryl Katz has promised $100 million toward a new rink, and that they're looking at other private sources of income.

He said the City of Edmonton has not given them a financial commitment, and declined to say whether the Oilers would still build the arena if public cash - estimated at $300 million to $400 million - doesn't come through.

"I'm not even going there," said LaForge. "The idea is to get the design and the development put together, understand what is on the table, how much it costs and where it's going to be. "

"Through the process we'll be understanding what partnerships look like on the arena."

The provincial government has previously said there will be no direct public funding for the rink.

Debate has been alternately simmering and boiling for two years in the Alberta capital over what's to be done with Rexall Place, the time-worn circular building that has been the Oilers' home since its World Hockey Association Days in the early 1970s.

Almost all agree the arena-located an industrial area in the city's northeast - does not meet the standards of current NHL rinks. It has narrow concourses, long lineups for washrooms, little to no room for modern satellite and TV trucks, and a dispiriting smooth-grey cement on rough-grey cement interior decor.

Last year, a committee struck by Edmonton Mayor Stephen Mandel recommended building a $450-million arena in the downtown as part of a larger core revitalization project. The committee also urged taxpayers pay 70 per cent of it.

There were media reports last week that Katz is actually planning a $1-billion super-project that would include an 18,000-seat rink, a 10,000-seat practice rink, condos, retail stores, a hotel, a casino, and student housing.

LaForge declined to discuss those reports Monday, but confirmed that Katz has secured land on the northwest corner of downtown, a site currently home to a casino and surface parking lots.

LaForge, who said they are still looking at other sites, said they will over the next few months develop a master construction plan, choose a lead architect, hammer out a payment plan, launch a project website and then bring a plan to city council.

There is no current timeline for construction or completion.

Mandel has ruled out property tax hikes to pay for the arena. But he said recently he has not ruled out improvement levy options, such as allowing the city to essentially borrow against the future value of the developed site to fund the construction.

The mayor also said he would favour the city owning the arena, but LaForge said that has yet to be hammered out.

"I would say the needle is in favour of cities owning their own arenas, but there's work to be done on what that looks like."

Scott Hennig, Alberta director of the Canadian Taxpayers Federation, labelled Monday's announcement a political move, aimed at putting pressure on dissenting local politicians to get on board.

"This whole scheme they're trying to pull here is exactly what happens in a lot of other cities that end up footing the bill for new arenas," said Hennig.

"You go out and show a brand-new fancy arena with lots of smiling people in the pictures and lots of colour and say, 'It's only going to cost a few hundred million dollars."'

The federation has been a thorn for some in the arena debate.

Last spring, through freedom of information requests, the federation revealed that Mandel's committee had excised from its final report information that could damage a bid for public funds, including the fact that recent NHL rinks in Ottawa, Montreal, Toronto and Vancouver were completed with private funding.

"There hasn't been an NHL arena built in the last 20 years using public money. It was all private money, and that can't be ignored," said Hennig.

The debate is expected to dominate headlines in the months to come because the Oilers, who won five Stanley Cups in the 1980s with big names like Wayne Gretzky and Mark Messier, have become part of the city's identity and cultural DNA.

Even though the team hasn't won a championship for two decades and has missed the playoffs the last three seasons, Oilermania dominates sports pages and sports talk-radio, even in the stifling heat of mid-August.

Rexall Place is working on 155 consecutive sellouts of 16,839 fans. The waiting list for tickets is close to 2,000 and all 66 luxury suites are sold out.

The team's lease on Rexall Place is up in 2014.